Medicare Part D 2018

part d plans

Medicare Part D 2018

Here are a few highlights of the defined standard Medicare Part D plan changes from 2017 to 2018. The chart below shows the changes in defined standard Medicare Part D design for plan years 2014, 2015, 2016, 2017 and 2018. The CMS “Part D Benefit Parameters for Defined Standard Benefit” is the minimum allowable Medicare Part D plan coverage. However, CMS does allow Medicare Part D plans to offer a variation on the defined standard benefits (for example, a Medicare Part D plan can offer a $0 Initial Deductible).

  • Initial Deductible:
    will be increased by $5 to $405 in 2018.
  • Initial Coverage Limit (ICL):
    will increase from $3,700 in 2017 to $3,750 in 2018.
  • Out-of-Pocket Threshold (or TrOOP):
    will increase from $4,950 in 2017 to $5,000 in 2018.
  • Coverage Gap (donut hole):
    begins once you reach your Medicare Part D plan’s initial coverage limit ($3,750 in 2018) and ends when you spend a total of $5,000 out of pocket in 2018.
    In 2018, Part D enrollees will receive a 65% Donut Hole discount on the total cost of their brand-name drugs purchased while in the donut hole. The discount includes, 50% discount paid by the brand-name drug manufacturer and will apply to getting you out of the donut hole (or TrOOP), however the additional 15% paid by your Medicare Part D plan will not count toward your TrOOP.
    For example: If you reach the donut hole and purchase a brand-name medication with a retail cost of $100, you will pay $35 for the medication, and receive $85 credit toward meeting your 2018 total out-of-pocket spending limit.
    Medicare Part D beneficiaries who reach the Donut Hole will also pay a maximum of 44% co-pay on generic drugs purchased while in the coverage gap (a 56% discount).
    For example: If you reach the 2018 Donut Hole, and your generic medication has a retail cost of $100, you will pay $44. The $44 that you spend will count toward your TrOOP or Donut Hole exit point.
  • Minimum Cost-sharing in the Catastrophic Coverage Portion of the Benefit**:
    will increase to greater of 5% or $3.35 for generic or preferred drug that is a multi-source drug and the greater of 5% or $8.35 for all other drugs in 2018.
  • Maximum Co-payments below the Out-of-Pocket Threshold for certain Low Income Full Subsidy Eligible Enrollees:
    will increase to $3.35 for generic or preferred drug that is a multi-source drug and $8.35 for all other drugs in 2018

Chart comparing 2014 through 2018 defined standard Medicare Part D prescription drug plan parameters

Click here to see a comparison of plan parameters for all years 2006 to 2018

Medicare Part D Benefit Parameters for Defined Standard Benefit
2014 through 2018 Comparison
Part D Standard Benefit Design Parameters: 2018 2017 2016 2015 2014
Deductible – (after the Deductible is met, Beneficiary pays 25% of covered costs up to total prescription costs meeting the Initial Coverage Limit. $405 $400 $360 $320 $310
Initial Coverage Limit – Coverage Gap (Donut Hole) begins at this point. (The Beneficiary pays 100% of their prescription costs up to the Out-of-Pocket Threshold) $3,750 $3,700 $3,310 $2,960 $2,850
Out-of-Pocket Threshold – This is the Total Out-of-Pocket Costs including the Donut Hole. $5,000 $4,950 $4,850 $4,700 $4,550
Total Covered Part D Drug Out-of-Pocket Spending including the Coverage Gap – Catastrophic Coverage starts after this point.

See note (1) below.

$7,508.75 (1) $7,425.00 (1) $7,062.50 (1) $6,680.00 (1) $6,455.00 (1)
Total Estimated Covered Part D Drug Out-of-Pocket Spending including the Coverage Gap Discount (NON-LIS) See note (2). $8,417.60

plus a 65% brand discount

$8,071.16

plus a 60% brand discount

$7,515.22

plus a 55% brand discount

$7,061.76

plus a 55% brand discount

$6,690.77

plus a 52.50% brand discount

Average NON-LIS percentage brand and generic drug purchases made during the coverage gap used to estimate the Total Covered Part D OOP threshold for NON-LIS beneficiaries (see above). Brand: 89.18%
Generic: 10.82%
Brand: 87.9%
Generic: 12.1%
Brand: 84.6%
Generic: 15.4%
Brand: 85.9%
Generic: 14.1%
Brand: 86.2%
Generic: 13.2%
Catastrophic Coverage Benefit:
   Generic/Preferred
Multi-Source
Drug
 (3)
$3.35 (3) $3.30 (3) $2.95 (3) $2.65 (3) $2.55 (3)
    Other Drugs (3) $8.35 (3) $8.25 (3) $7.40 (3) $6.60 (3) $6.35 (3)
Part D Full Benefit Dual Eligible (FBDE) Parameters: 2018 2017 2016 2015 2014
   Deductible $0.00 $0.00 $0.00 $0.00 $0.00
   Copayments for
Institutionalized
Beneficiaries
$0.00 $0.00 $0.00 $0.00 $0.00
Maximum Copayments for Non-Institutionalized Beneficiaries
    Up to or at 100% FPL:
        Up to Out-of-Pocket Threshold
      Generic/Preferred
Multi-Source
Drug
$1.25 $1.20 $1.20 $1.20 $1.20
      Other $3.70 $3.70 $3.60 $3.60 $3.60
     Above Out-of-
Pocket
Threshold
$0.00 $0.00 $0.00 $0.00 $0.00
    Over 100% FPL:
        Up to Out-of-Pocket Threshold
      Generic/Preferred
Multi-Source
Drug
$3.35 $3.30 $2.95 $2.65 $2.55
      Other $8.35 $8.25 $7.40 $6.60 $6.35
     Above Out-of-
Pocket
Threshold
$0.00 $0.00 $0.00 $0.00 $0.00
Part D Full Subsidy – Non Full Benefit Dual Eligible Full Subsidy Parameters: 2018 2017 2016 2015 2014
Eligible for QMB/SLMB/QI, SSI or applied and income at or below 135% FPL and resources ≤ $8,890 (individuals) or ≤ $14,090 (couples) (4)
   Deductible $0.00 $0.00 $0.00 $0.00 $0.00
    Maximum Copayments up to Out-of-Pocket Threshold
      Generic/Preferred
Multi-Source
Drug
$3.35 $3.30 $2.95 $2.65 $2.55
      Other $8.35 $8.25 $7.40 $6.60 $6.35
   Maximum Copay
above
Out-of-Pocket
Threshold
$0.00 $0.00 $0.00 $0.00 $0.00
Partial Subsidy Parameters: 2018 2017 2016 2015 2014
Applied and income below 150% FPL and resources between $8,890-$13,820 (individuals) or $14,090-$27,600 (couples) (category code 4) (4)
   Deductible $83.00 $82.00 $74.00 $66.00 $63.00
   Coinsurance
up to
Out-of-Pocket
Threshold
15% 15% 15% 15% 15%
    Maximum Copayments above Out-of-Pocket Threshold
      Generic/Preferred
Multi-Source
Drug
$3.35 $3.30 $2.95 $2.65 $2.55
      Other $8.35 $8.25 $7.40 $6.60 $6.35
(1) Total Covered Part D Spending at Out-of-Pocket Threshold for Non-Applicable Beneficiaries – Beneficiaries who ARE entitled to an income-related subsidy under section 1860D-14(a) (LIS)
(2) Total Covered Part D Spending at Out-of-Pocket Threshold for Applicable Beneficiaries – Beneficiaries who are NOT entitled to an income-related subsidy under section 1860D-14(a) (NON-LIS) and do receive the coverage gap discount. For 2018, the weighted gap coinsurance factor is 80.5286%. This is based on the 2016 PDEs (89.18% Brands & 10.82% Generics)
(3) The Catastrophic Coverage is the greater of 5% or the values shown in the chart above. In 2018, beneficiaries will be charged $3.35 for those generic or preferred multisource drugs with a retail price under $67 and 5% for those with a retail price greater than $67. For brand-name drugs, beneficiaries would pay $8.35 for those drugs with a retail price under $167 and 5% for those with a retail price over $167.
(4) This amount includes the $1,500 per person burial allowance. The resource limit may be updated during contract year 2017.
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